Apple Abandons Plan to Buy Memory Chips from China’s YMTC

BY Dave Johnson

Published 17 Oct 2022

Memory chips

Apple has reportedly dropped plans to buy memory chips from one of China’s top memory chip makers due to tighter U.S. export controls. 

According to Nikkei Asia, the tech giant wanted to buy 128-layer 3D NAND flash memory chips from Yangtze Memory Technologies (YMTC). That’s not surprising, considering YMTC chips are reportedly the most advanced by any Chinese chip maker. Moreover, reports suggest that the company’s flash memory is 20 percent cheaper than the competitors’. 

It’s no wonder Apple may have had plans to use YMTC chips for iPhones sold in China. The tech giant reportedly considered buying 40 percent of the chips needed for all iPhones from the YMTC.

Indeed, Nikkei Asia claims that Apple performed month-long testing and verification that should have resulted in iPhone 14 models with YMTC chips. But that never happened. 

“The products have been verified, but they did not go into the production lines when mass production of the new iPhone began,” a source told the publication.

So what went wrong? Apple reportedly abandoned its plan due to political pressure and criticisms from United States policymakers. Here’s why. 

How U.S. Export Laws Prevented iPhones With YMTC Memory Chips

The Biden administration recently introduced new export laws to improve processor production in the United States and prevent potential security issues. It also restricts Beijing’s access to specific semiconductor chips made worldwide with U.S. equipment. 

Expectedly, the new rule affects several tech companies, including Apple. While the tech giant is not prohibited from buying YMTC products, specific restrictions prevent U.S. companies from sharing technologies or designs with companies on an Unverified List. 

YMTC reportedly made that list last week after failing to provide specific information about its users to the United States. Besides, U.S. Commerce Department is currently investigating the Chinese company over whether it violated export controls by selling chips to Huawei.